Before You Say “I Do” – The Pros of a Prenuptial Agreement
by: Smith and Howard Wealth Management
With wedding season fast approaching, brides and grooms are beginning to think about gowns, tuxes, receptions and honeymoons. While a wedding should be about romance and beginnings, marriage has an added dimension: business. So, while planning your nuptials, we believe you should also plan for what happens in the event of separation, divorce or death.
A prenuptial agreement is often the most secure way to achieve this in a way that brings each party’s assets and debts immediately into the picture and creates an honest foundation from which to start. And honesty is imperative; without it, the prenup agreement might not be enforceable.
The stigma that only the wealthy party in the marriage has these contracts drafted to protect their assets is undeserved. In a time when people are delaying marriage until their careers are well established and assets have been accumulated, and when the divorce rate is over 50%, it is a prudent step to take for both parties. Typically, people have a very negative connotation with the word “prenup”; viewed and discussed for what they are intended to achieve, the purpose should be completely positive.
I actually had one friend argue, “A prenuptial agreement is the most romantic thing you can ask for, since it entirely takes money out of the equation.” Whether people agree with her, is something else altogether. But it is a viewpoint to consider.
Who should have a prenuptial agreement?
How to approach the subject with your future spouse
Be up front. Mention the topic of prenuptial agreement early on so it’s not a surprise once you reach engagement. Make sure the agreement is drafted in advance, so the court cannot make the case that one party was coerced into the contract prior to the marriage; thus it might not be upheld in court.
Smith and Howard Wealth Management works with our clients to create a complete financial plan, including a detailed outline of all assets, investments and liabilities. We can work with one or both parties to review this information prior to drafting a prenup agreement. Our advisors, in our role as your family CFO, can also connect you with an experienced attorney to walk you through the agreement process. Please call us at 404-874-6244.
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